Commissioner of Inland Revenue v. Church Body of the Hong Kong Sheng Kung Hui and Another

FAMV No. 11 of 2015

IN THE COURT OF FINAL APPEAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO. 11 OF 2015 (CIVIL)

(ON APPLICATION FOR LEAVE TO APPEAL FROM
CACV NO. 41 OF 2010)

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DETERMINATION

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Mr Justice Ribeiro PJ :

1.We are satisfied that the questions of law proposed by the applicant are of the requisite importance to justify the grant of leave, namely:

(1)   Does any “enhancement for realisation principle” arise from the authorities cited in paragraph 9 of the Judgment of the Court of Appeal, and if so, what is its scope? (See: §§9, 10 and 12.6 of the Judgment).

(2)  In determining whether a taxpayer has changed his intention regarding an asset from holding it for investment to holding it for trading, is the Board of Review required to refer to and apply the “enhancement for realisation principle” (as understood by the Court of Appeal or otherwise), and if the Board fails to do so, does this justify the appellate court’s interference with the Board’s finding of fact? (See: §§10, 12.2 to 12.19 of the Judgment)

(3)  Does a finding of fact on change of intention based solely on “enhancement activities” necessarily amount to an error of law made by the Board of Review? (See: §10.7 of the Judgment).

2.The appeal will be heard on 8 January 2016.

Mr Denis Chang SC and Mr Newman Lam, instructed by P.C. Woo & Co., for the 1^st and 2^nd appellants

Mr Eugene Fung SC and Mr Wilson Leung, instructed by Department of Justice, for the respondent